THAILAND Law and Practice Contributed by: Olaf Duensing, Jerrold Kippen and Weeraya Kippen, Duensing Kippen, Ltd.
6.12 Insurance Issues The tenant must use the property for the contractually agreed purpose and refrain from using the property in any way that is not considered ordinary and usual. Further, the tenant has a duty to take care of the prop - erty as a person with ordinary prudence would do. 6.13 Restrictions on the Use of Real Estate The tenant must use the property for the contractually agreed purpose and refrain from using the property in any way that is not considered ordinary and usual. Further, the tenant has a duty to take care of the prop - erty as a person of ordinary prudence would do. 6.14 Tenant’s Ability to Alter and Improve Real Estate Leases are generally governed by the CCC. However, there are two specific laws that additionally govern certain leases: • the Hire of Immovable Property for Commerce and Industry Act defines commercial purposes with regard to leasing commercial property (as described in 6.2 Types of Commercial Leases ); and • regulations issued under the Consumer Protec - tion Act, which regulates residential structure (eg, house, apartment and condominium) leases in accordance with which any person or company that leases out five or more residential structures (with some limited exceptions) is considered a residential structure “business operator”. The regulations require that: • all residential lease agreements between a busi - ness operator and the lessee include a readily leg - ible version in Thai; and • the details of the physical condition of the property and equipment (if any) be inspected and acknowl - edged by the lessee and be attached to the lease agreement. 6.15 Specific Regulations A tenant’s insolvency would commonly trigger the ter - mination provisions of the rental agreement where the tenant fails to perform its obligation, such as paying the agreed rental amount.
Additionally, some leases shift the local property tax burden to the lessee. Any changes in the local tax would then affect the financial burden of the lessee. 6.8 Costs Payable by a Tenant at the Start of a Lease The following are typically payable by a tenant at the start of a lease: • security deposit (for rental and service fee); • security deposit for any fitting-out period; and • telephone line/internet installation charges. 6.9 Payment of Maintenance and Repair The total amount payable by a tenant is commonly split into a rental component and a service compo - nent. The service component covers the payment for the maintenance and repair of the shared area. 6.10 Payment of Utilities and Telecommunications Utilities and telecoms are typically charged as follows. • Air conditioning is provided at certain hours and is part of the service agreement. Any additional time outside of these fixed hours will be billed separate - ly at the contractually agreed rate. • Electricity will be charged at the agreed rate according to usage. • Water is charged at the agreed rate according to usage. • Telecommunications charges will depend on the telecommunications service provider. However, the owner might charge the installation fee to the tenant. It should be noted that the utility rate must reflect the actual rate paid by the owner if the lease falls under certain regulations issued in accordance with the Consumer Protection Act, which regulates residential structure leases (as further explained in 6.14 Specific Regulations ). 6.11 Payment of Property Taxes Landlords are legally responsible for property tax as property owners. However, lease agreements often shift the payment burden to the tenant, especially in long-term lease agreements.
628 CHAMBERS.COM
Powered by FlippingBook